Vivisecting Media

MySpace + Snocap = profit?

Recently MySpace (like you really need a link) announced that they are seriously looking into providing a for-sale digital music service:

"The goal is to be one of the biggest digital music stores out there," MySpace co-founder Chris DeWolfe told news agency Reuters.
– "MySpace set to sell music online" BBC News

Initial reports are saying that it will still be a "trial" but with comments like this I have no doubt it will quickly go beyond trial and into full swing.  With the announcement that MySpace will begin offering music sale services they also announced a new partnership with Snocap to provide the service. PaidContent.org has stated that the deal with Snocap is not based around money but "to gain equity in Snocap as it drives distribution."

A while back (Novemeber 15th 2005 to be exact) MySpace and Interscope launched MySpace Records first volume compellation.  It was their intention to leverage the existing artist base and form a label to sell the artists music via physical distribution. The initial release drew a lot of press attention but in many peoples minds it was a flop and that was pretty much the last we heard of it.

It looks like they are re-approaching the same idea of leveraging the artist base. What is interesting to me is how they use Snocap’s services to do this. At the moment we don’t know how MySpace plans to integrate the services. Will it be an admin panel the artists enable via the site?  Do artists get to set the rate?  What is the percentage fee?  Does anyone get to use it?  How will MySpace monitor pirated material?  What about copyright infringement with samples?  There are a ton of questions for lawyers, but in my mind the biggest question is how easy will it be to use both as an artist and as a consumer?  I guess we just have to wait and see.

So this brings up another point… what is Snocap?  I am sure most of you have heard of it or at least know that it was started by Shawn Fanning (aka the inventor of Napster) but what does Snocap do?  Niki asked me that question yesterday and I honestly didn’t have an answer, so I decided to read up on it.

Snocap is what I like to refer to as a digital distribution service (DDS), they do more then that but this seems to be the best base description.  So what is a DDS?  It is a relatively new service that is actually based on the old distribution model.  In the old world (physical sales) you had this chain of command: artist -> label -> distribution service -> storefront -> customer.  The only way for a label to get their music to a store was through the critical distribution service.

In the new world there are is not any physical services… once the digital file is made it is an infinitely replicate-able product.  In theory, there is no real need for the middle men.  This was one of the goals of Fake Science, to create a store that allows artists and labels to directly sell to their customers and no longer have to deal with all the skimming before it gets back to the creator.

Unfortunately, old models are hard to change, theories don’t always work and companies really don’t want to lose their stake in an industry.  This means that a "new" kind of service has been created, the DDS.  Companies like The Orchard, IODA, and Snocap are coming into existence to help labels get content into the stores.  This is good and bad.  Bad because we once again have a middle man taking a percentage of the sales before it gets to the label and ultimately the artist.  Good, because the label now has only one point of contact to get their material into many different store fronts.  I have a personal aversion to DDS’s but I understand why they are coming into existence…  anyway, that’s a whole other topic.

Back to Snocap.  Snocap is a DDS that works with independent artists, indie labels and major labels.  They provide store licensing, track management, media type (between MP3 and WMA formats) and also optional DRM management (if they choose WMA).  Stores (or even p2p services) who use Snocap now have access to the catalog and can sell the music if they follow the Snocap requirements.  Snocap also provides the ability for an artist to create their own storefront and then make sales through Snocap.

At the core Snocap is a DDS but they also provide a lot of other services for artists and labels that many of the new DDSs are not (yet).  Overall its an interesting model, so much so that a lot of the Majors are providing content to Snocap, so I can see why MySpace has decided to go with them.  I will be interested to see if MySpace allows other DDSs to provide licensing rights directly to MySpace or if you have to go through Snocap.

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